Policy Innovations Digital Magazine (2006-2016): Briefings: Islands of Inertia

In the wake of Japanese Prime Minister Naoto Kan's victory over Ichiro Ozawa for control of the ruling Democratic Party of Japan, is more inertia in store for economically stagnant Japan? For a look at what might come next, Devin Stewart had a chance to interview Jeffrey Kingston this week on his new book Contemporary Japan: History, Politics, and Social Change since the 1980s (Wiley-Blackwell, 2010).

Why did you decide to write about contemporary Japan? What did you hope to achieve with this book?

I did not think that the remarkable changes that have happened in Japan over the past 20 years have been sufficiently recognized or understood because the dominant storyline is stagnation, inertia, and political gridlock. While this narrative is partially true, the changes I look at are in terms of attitudes, norms, and expectations. Japan in 2010 is different in so many ways from what it was like in 1990, both at a superficial and fundamental level. One of my major contributions is examining the rise of risk and its consequences in a society poorly prepared for it. My goal is to produce an accessible introduction to a country that remains very important, to question assumptions and myths about Japan, and to give a balanced perspective on what I have lived through since moving here in 1987.

What are some of the myths that foreigners or Japanese believe that need to be dispelled?

Income disparities are increasing, and the middle class is not as prevalent as people once thought. Japan, Inc. was based on the twin pillars of stable jobs and families and both are ever less stable. Precisely because we are entering the third decade of the Lost Decade, people have lost faith in those who govern and are less deferential to authority and more skeptical. There is far greater transparency and a more vibrant civil society than is generally appreciated. Japan is also a far less paternalistic society than it used to be, and the "precariat" [precarious + proletariat] of part-time, dispatched, and temporary workers has nearly doubled as a percentage of the workforce since 1990. These workers have low security, wages, benefits, and training and are locked into careers with bleak prospects.

What are the biggest challenges facing Japanese society today?

One of the central themes is the rise of risk since the early 1990s, evident in negative net equity in housing, an expanding "precariat," and a rising misery index of divorce, domestic violence, child abuse, suicide, declining household income, and growing disparities. These developments have exposed the flaws of the "Japan, Inc." system and undermined a sense of social cohesion.

What are the causes and possible solutions to the demographic "time bomb"?

I think fertility has declined because Japan has shortchanged investments in the family and is not nearly as supportive as it might be while companies have been slow to implement family-friendly work policies. There are no palatable quick fixes. At best the government can mitigate the consequences and implement policies on an ad hoc basis that will help it achieve a muddle-through scenario. It's worth bearing in mind that the over-65 population doubled between 1988 and 2008—a hyper-aging that has been managed reasonably well. Because of the rapid aging of society it is hard to be very optimistic concerning the Japanese economy, government finances, and Japan's capacity to remain a leading international actor.

How are nonprofit organizations helping advance social justice in Japanese society? Are nonprofits becoming more pervasive? Why?

I think the NPO [nonprofit organization] sector remains weak and that its potential has not developed because bureaucrats are reluctant to empower civil society. As a result there are fewer than 100 NPOs that qualify for the tax status that enables contributors to deduct their contributions from their income taxes. But despite being small and underfunded, some NPOs punch above their weight and are developing effective media strategies to mainstream their messages and build pubic support. They have played a leading role in drawing attention to the plight of the "precariat." There is dynamism among those involved in community-based social enterprises but the overall situation is not very good. Small reforms in tax treatment and partnering could have a significant impact on their operations.

How is the political system in "crisis"?

Politicians have lost their legitimacy because they have not addressed the problems that concern voters and are seen to be inept, out of touch, and corrupt, apparently more concerned about scoring points than addressing the huge policy challenges that face the nation.

Do you believe Japanese politics are passing through a phase of "creative destruction" as longtime Japan watcher Gerald Curtis has argued? If so, what is the evidence that this is happening?

I think that it is a slow-motion train wreck of realignment that began in the early 1990s and we are not nearly finished. The ousting of the LDP from power in 2009 after some 55 years of dominating Japanese politics was a significant watershed in this process, but voters remain volatile because parties are not delivering. I expect that the DPJ leadership contest will give some momentum to realignment, but a stable two-party system remains a distant goal.

Is the Japanese concept of national security unique? Will Japan become a "normal nation"?

I always steer away from ascribing "unique" to Japan. I think that security discourse in Japan is very limited and the public is not well informed about why Tokyo seeks to cling close to the United States and accommodates the U.S. military presence. I think that "normal" can be defined many ways, but there is a lot of domestic resistance in terms of Japan developing a more assertive security role and there are also serious questions about whether a diminished Japan has the capacity or inclination to act more autonomously and come up with the resources to function as an equal in the U.S. security alliance.

Does global awareness of energy security and climate change present an opportunity for Japan as a leader in efficiency?

Let me start out by saying that Japan has not even lived up to its Kyoto Protocol targets on CO2 emission reductions. Even as industrial energy consumption remains impressive, household energy consumption is surging. Sure there is an opportunity but the government has not adopted policies that would support renewable energy production and instead concentrated resources on nuclear energy. Developing a smart grid to handle fluctuating solar and wind energy should be a priority. I think Japanese companies can do well exporting their technology and know-how on energy efficiency and environmental degradation with China representing a growth market in these fields.

Will Japan ever really open up to mass migration?

No. Attitudes are largely negative, and there is no support for large-scale, permanent foreign communities because the media and politicians constantly harp about crime, which is actually low, and ignore any potential benefits. Immigration is framed in terms of national identity and social cohesion rather than solving Japan's labor shortages, stimulating consumption, and funding pension and medical programs. If Japan has to make a choice between economic decline and immigration, and in many respects that choice has already been made through inertia, it will accept decline.

Why did you choose to include the Imperial Family and yakuza (organized crime syndicates) in your section on institutions at risk?

I thought that both of these traditional institutions have faced adversity in the Heisei era and their respective responses are illustrative. The Imperial Household Agency (IHA) mismanages the Imperial Family and is acting in ways that undermine its long-term viability. Emperor Akihito's reconciliation diplomacy has been overshadowed by the overbearing inclinations of the IHA bureaucracy. The power of the court's symbolism depends on certain illusions that are undermined by the bullying of the Crown Prince and Princess through selective press leaks and public jousting. In contrast, I argue that, "The yakuza's problems are exactly those of Japan as a whole; they are rapidly aging, have trouble recruiting and retaining a young cadre, face hungry international competitors and an unfavorable regulatory market, are downsizing while merging to gain efficiencies while cutting costs, and are trying to reinvent themselves and adapt their core strengths to new market niches all amidst a stagnant economy. Like their upper-world counterparts, underworld bosses are pruning their core labor force and relying increasingly on non-regular workers and outsourcing. Harvard Business School is not likely to make them a case study, but it ought to."

Did you intentionally omit the Japanese education system and public justice system? What do you say to criticisms, for example in the Economist, about this omission in your book?

As it is I had to cut two chapters—on human trafficking and popular culture—to meet the publisher's rigid word targets. But yes these are topics that do merit more scrutiny and my last book Japan's Quiet Transformation (2004) does analyze judicial reforms. For me it is encouraging that the Economist review seemed to like what I did write and so confined their quibbling to what I did not have space to write. Perhaps in my next book.

At the end of your book, you list six policy areas that will serve as a "barometer" of Japan's progress in its renewal. Tell me about those areas.

I focus on:

1. Risk
2. Family
3. Immigration
4. Civil Society
5. Governance
6. Environment

I think that Japan's future prospects depend on how it manages these challenges and conclude that a muddle-through scenario is about as good as one can expect.

Why, ultimately, is the pace of change so slow in "arthritic" Japan as Edward Lincoln of NYU calls it?

Reform is difficult and wrenching in any society and the vested interests are adept at defending their turf. I think Japan has not been nearly as arthritic as some would argue but there is too much complacency, circumstances do not seem so dire, thus instead of dramatic reforms there is an inclination to settle for half-measures that limit both dislocations and the upside of reform. The "islands of inertia" still retain considerable strengths and most people are perhaps too comfortable so there is no sense of urgency even if people are pessimistic about the future and certain Japan's best days are behind it.

Finally, where do you see Japan in 2030?

Gazing into my crystal ball I would say that it won't be nearly as dismal as most Japanese seem to expect and it won't sink into the abyss. It will remain a reasonably prosperous country with social problems that are the envy of many other advanced industrialized nations, and in muddling through on an ad hoc basis it will mitigate its problems and frustrate wonks and pundits who want it to be more decisive and aggressive in tackling its problems. Of course in an archipelago that has suffered through more than its share of natural calamities in a region bristling with arms and disputes it would be foolish to discount the possibilities of devastating developments that could derail this cozy scenario of gradual decline.